If the spot rate for euros depreciates, and all other variables and expected values remain constant, U.S. investors contemplating European investments would:
a. get larger returns in terms of dollars.
b. get smaller returns in terms of dollars.
c. get very similar returns because of arbitrage.
d. lose the principal of the investment.
Answer: b. get smaller returns in terms of dollars.
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The consumption function shows that when disposable income increases by one dollar, consumption expenditure
A) does not change. B) increases by more than a dollar. C) increases by one dollar. D) decreases by less than a dollar. E) increases by less than a dollar.
If the yen to dollar exchange rate is 115, the U.S. price index is 140, and the Japanese price index is 165, what is the U.S. real exchange rate?
A) 74.52 B) 97.58 C) 135.55 D) 200.87
A graph shows the price of a pound of cucumbers on the vertical axis and the quantity of new cars sold by GM on the horizontal axis. The price of a pound of cucumbers remains constant as the quantity of new cars sold increases
The graph of these data is A) a horizontal line. B) a vertical line. C) a curve with a maximum. D) a positively-sloped line.
Education is an example of
a. investment in physical capital. b. investment in human capital. c. investment in natural resources. d. technological change. e. none of the above.